Human Capital Policies and Education

Singapore lauds its use of human capital development (HCD) as a national economic policy. Because the country has no natural resources aside from its location and deepwater natural harbor, it relies largely on its human capital to generate economic success and wealth (Gross, 1999).

What is "human capital"? Human capital is defined by Brad Keeley (2007), author of Human Capital, as "our knowledge, skills learning, talents and abilities." Human capital is capital like any other - it's an asset that yields income and output over time. Gary S. Becker and Jacob Mincer claim that personal incomes vary according to the amount of investment in human capital; that is, the education and training undertaken by individuals or groups of workers. A further expectation is that widespread investment in human capital creates in the labor-force the skill-base indispensable for economic growth (Marshall, 1998).

Singapore has depended heavily on external trade, but because of competition with its lower-costing neighbors, is shifting from a labor-based economy to a "high technologies, value-added clean, capital-intensive products, and sophisticated business and financial services" economy (Gross, 1999). It has invested in this human capital-based economy by investing heavily in education and training for its citizens.

All Singaporeans must attend primary 6 education and government schools as part of National Education. The People's Action Party is the largest provider of preschool education through its community arm. According to the Economic Development Board of Singapore, a public university named Singapore University of Technology and Design will open in 2011, and the government seeks to provide higher education for 30% of each cohort.

Singapore values human capital development so much that there's a summit dedicated to the subject every year! The aims of the Singapore Human Capital Summit are:

• generating new knowledge and ideas on human capital management and leadership practices;
• advocating the latest thinking and practices on human capital management that work; and
• demonstrating the value and effectiveness of good human capital practices in enhancing an organisation's competitiveness.

The Summit is exclusively for CEOs, Chief HR Officers and Directors with people management and development responsibilities.

Because the emphasis the Singaporean government places on education leads not only to economic success, but also to better educated citizens, it can be viewed as both a means and an end. Other countries in the region can learn from Singapore's investment in education to not only improve the value and ability of their citizens, but to give everyone - wealth or poor - a fighting chance to contribute to the prosperity of their country as well as their own life.

Sources

1. Becker, Gary S. "Human Capital." The Concise Encyclopedia of Economics. 2008. Library of Economics and Liberty. Retrieved March 24, 2010 from the World Wide Web:
2. "Education - Singapore Economic Development Board." Homepage - Singapore Economic Development Board. 2010. Web. 24 Mar. 2010.
3. Gross, A. "Human Resource Issues in Singapore." 1999. Retrieved March 24, 2010 from PacificBridge.com:
5. "Singapore Human Capital Summit 2009." 2010. Singapore Human Capital Summit 2009. Web. 24 Mar. 2010.
6. Keeley, Brian. Human Capital: How what you know shapes your life. 2007. Retrieved March 24, 2010 from OECD.org:
7. Marshall, Gordon. "Human-capital theory." A Dictionary of Sociology. 1998. Retrieved March 24, 2010 from Encyclopedia.com: "